location planning ppt
TRANSCRIPT
OPERATIONS MANAGEMENT
Location Planning & Analysis
Name : Sanket Doshi
Roll No: 18 Div : A MMS
10/04/2023 Location Planning & Analysis 1
LOCATION PLANNING
• “Location” refers to the geographical position of an object, person or place
• “Planning” is both the organizational process of creating and maintaining a plan.
• “Location Planning” refers to all activities involved in determining & selecting the most suitable location and utilizing its benefits in an efficient manner.
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When is Location Planning Required
Requirement Of A New Location
Relocate An Existing Business
Expansion Of an Existing Location
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FACTORS DRIVING LOCATION DECISONS
• NEW MANUFACTURING UNIT • EXPANSION OF BUSINESS • AVAILABILITY OF RESOURCES • EMERGENCE OF NEW
CONDITIONS• UNDERTAKE COMPETION
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FACTORS AFFECTING LOCATION
Primary Factors Secondary Factors
Supply of Raw Materials
Nearness to the Market
Infrastructure Facilities
Natural
Social
Miscellaneous
Variable Weights MethodVariable weights are assigned to each factor and sites are evaluated along the factor scale..
Potential SitesFactors Maximum
PointsS1 S2 S3 S4
F1
F2
F3
400
300
100
300
150
50
350
200
75
350
150
80
200
100
40Sum of ratings
500 625 580 340
Equal Weights MethodEqual weights are assigned to different factors (F) and the sites (S) are evaluated among the factor scale Potential Sites
Factors S1 S2 S3 S4
F1
F2
F3
3
4
7
6
5
2
8
9
6
2
3
3Sum of site ratings
14 13 238
Factor Rating Method
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On the basis of factor rating analysis we choose Site 1 because it has the highest weighted score.
Centre of gravity method
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iicg l
xlcoordinateX
i
iicg l
ylcoordinateY
Composite Measure Method
Quantitative Factors Site ‘A’ Site ‘B’ Site ‘C’Cost of Land 50000 49000 45000Buildings 450000 420000 480000Power 10000 9000 10000Freight 50000 85000 92000Water 5000 1000 3000Labour Charges 40000 25000 32000Taxes 5000 2000 4000 Total Operating Cost 610000 591000 666000 Qualitative Factors Cost of living Very High Low ModerateHousing facilities Excellent Poor GoodCommunity Facilities Excellent Poor GoodCommunity Attitude Good Good Indifferent
Comparative appraisal of various plant sites with reference to the qualitative and quantitative factors affecting locational decisions
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Least Cost Method
The location which incurs least cost among all the locations is selected
Transportation MethodThe total transportation cost at various locations can be calculated and the location with the least total transportation cost can be chosen10/04/2023 Location Planning & Analysis 10
Importance Of Location Planning
• Reduces the Cost of production• Increase in Sales • Face Competition Effectively• Reduce Employ Turnover• Global Reputation and Goodwill
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THANK YOU…
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